If an insurance company wants to raise rates, what must they do first?

An insurance company must file for approval with the West Virginia Division of Insurance before increasing rates. This process is crucial because state regulations require insurers to obtain authorization for rate changes to ensure that they are justified and not discriminatory. The regulatory body assesses the proposed rate increase to determine whether it complies with state laws and remains in line with market conditions.

Filing for approval protects consumers by ensuring transparency and fairness in pricing. This step allows the West Virginia Division of Insurance to review the insurer's financial data, cost structures, and loss experience to verify that the new rates are adequately supported by the underlying data.

While notifying policyholders, holding public hearings, or posting new rates online are important components of the communication process regarding rate changes, they follow after the initial approval process has been completed. Obtaining approval first ensures that the rates set by the insurer are deemed appropriate and legal under West Virginia insurance law.